Pop culture collectibles manufacturer Funko (NASDAQ: FNKO) reported revenue ahead of Wall Street’s expectations in Q2 CY2026, with sales up 7.4% year on year to $207.7 million. Its non-GAAP profit of $0.26 per share was significantly above analysts’ consensus estimates.
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Funko (FNKO) Q2 CY2026 Highlights:
- Revenue: $207.7 million vs analyst estimates of $200.2 million (7.4% year-on-year growth, 3.7% beat)
- Adjusted EPS: $0.26 vs analyst estimates of -$0.19 (significant beat)
- Adjusted EBITDA: $40.9 million vs analyst estimates of $7.60 million (19.7% margin, significant beat)
- EBITDA guidance for the full year is $105 million at the midpoint, above analyst estimates of $77.6 million
- Operating Margin: 10.7%, up from -18% in the same quarter last year
- Free Cash Flow was $2.74 million, up from -$30.94 million in the same quarter last year
- Market Capitalization: $314.4 million
Company Overview
Boasting partnerships with media franchises like Marvel and One Piece, Funko (NASDAQ: FNKO) is a company specializing in creating and distributing licensed pop culture collectibles.
Revenue Growth
Reviewing a company’s long-term sales performance reveals insights into its quality. Even a bad business can shine for one or two quarters, but a top-tier one grows for years. Over the last five years, Funko grew its sales at a weak 2% compounded annual growth rate. This fell short of our benchmarks and is a rough starting point for our analysis.
Long-term growth is the most important, but within consumer discretionary, product cycles are short and revenue can be hit-driven due to rapidly changing trends and consumer preferences. Funko’s performance shows it grew in the past but relinquished its gains over the last two years, as its revenue fell by 6.5% annually. 
This quarter, Funko reported year-on-year revenue growth of 7.4%, and its $207.7 million of revenue exceeded Wall Street’s estimates by 3.7%.
Looking ahead, sell-side analysts expect revenue to grow 2.3% over the next 12 months. Although this projection indicates its newer products and services will spur better top-line performance, it is still below the sector average.
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Operating Margin
Operating margin is a key measure of profitability. Think of it as net income - the bottom line - excluding the impact of taxes and interest on debt, which are less connected to business fundamentals.
Funko’s operating margin has risen over the last 12 months, leading to break even profits over the last two years. However, its large expense base and inefficient cost structure mean it still sports inadequate profitability for a consumer discretionary business.
This quarter, Funko generated an operating margin profit margin of 10.7%, up 28.6 percentage points year on year. This increase was a welcome development and shows it was more efficient.
Earnings Per Share
Revenue trends explain a company’s historical growth, but the long-term change in earnings per share (EPS) points to the profitability of that growth — for example, a company could inflate its sales through excessive spending on advertising and promotions.
Sadly for Funko, its EPS declined by 26.8% annually over the last five years while its revenue grew by 2%. However, its operating margin didn’t change during this time, telling us that non-fundamental factors such as interest and taxes affected its ultimate earnings.
In Q2, Funko reported adjusted EPS of $0.26, up from negative $0.48 in the same quarter last year. This print easily cleared analysts’ estimates, and shareholders should be content with the results. Over the next 12 months, Wall Street expects Funko’s full-year EPS to shrink by 92.3% from $0.26 to $0.02.
Key Takeaways from Funko’s Q2 Results
It was good to see Funko beat analysts’ EPS expectations this quarter. We were also excited its EBITDA outperformed Wall Street’s estimates by a wide margin. Zooming out, we think this was a solid print. The stock traded up 15.3% to $6.10 immediately after reporting.
Funko may have had a good quarter, but does that mean you should invest right now? When making that decision, it’s important to consider its valuation, business qualities, as well as what has happened in the latest quarter. We cover that in our actionable full research report which you can read here (it’s free).
